Hindustan Composites to acquire stake in Swiggy; stock gains 8.6%

Hindustan Composites has signed a share purchase agreement to acquire 1,50,000 shares of Swiggy, worth Rs 5.17 crore

Hindustan Composites shares gained 8.6 per cent and touched an intraday high of Rs 633 per share on BSE. The company's stock soared after the auto ancillary announced that it has entered into a share purchase agreement with food delivery platform Swiggy.

As of 1:18 PM, shares of Hindustan Composites were up by 4.78 per cent, or Rs 27.85, at Rs 610.5. The market capitalisation of the company at around the same time stood at Rs 901.65 crore.

"We wish to inform you that the company has entered into a Share Purchase Agreement to acquire 1,50,000 Equity Shares of Re 1 each of Swiggy Limited by making an investment of Rs 5.175 crore," the company's exchange filing stated.

 

The acquisition will be completed on or before November 30, 2024, it added.

As of March 31, 2024, Swiggy's turnover was at Rs 4,653.3 crore, while it had incurred a loss of Rs 3,757.6 crore, and its net worth is pegged at Rs. 9,810 crore, as per the company's filing.

Swiggy is currently unlisted, and preparing for an initial public offer (IPO) in the near future. As per a Reuters report, Swiggy is targeting a valuation of around $15 billion for its upcoming stock market offering, with an aim to raise $1-1.2 billion. The food delivery platform's listing would make it one of the biggest IPOs in the country this year.

The food delivery platform received shareholder approval in April for an IPO that would raise up to $1.25 billion and its confidential filing is expected to be cleared by the Indian markets regulator Sebi within a month or so, according to the Reuters report. Following the approval, the company is expected to file a public prospectus.

The company is targeting a valuation of around $15 billion, though the final figure can change, as per Reuters.

Swiggy is an Indian online food ordering and delivery company that operates as a marketplace for ordering and delivering food. It also provides online grocery delivery and same-day package delivery services, along with other services for consumer convenience.

Hindustan Composites share price history

In the past one year, shares of Hindustan Composites have gained 49.3 per cent, compared to BSE Sensex's gain of 26.2 per cent in the period.